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"The more you know about yourself and your competitors in your category, the better, more efficient, and effective you will be at being able to deploy strategic assortment, pricing, promotions, organic search performance, and retail media effectiveness on Amazon, Walmart, Target, and any other ecommerce platform." — Nathan Rigby, co-founder at Analytic Index
Sometimes you have to look back to move forward, especially in today’s ever-changing ecommerce environment.
Cyber 5 — or the five biggest shopping days between Thanksgiving and Cyber Monday — offers valuable insights brands can use to prepare for upcoming seasonal ecommerce events in 2023.
Nathan Rigby, co-founder at Analytic Index, understands this better than most ecommerce practitioners. His company offers a platform that helps companies maximize opportunities with data.
Rigby and his team have spent time combing through data from the 2022 holiday shopping season and pinpointing trends that could position brands for greater success this year.
Rigby joined a recent episode of the "Unpacking the Digital Shelf" podcast, "2022 Cyber 5 Data Search Performance Deep Dive," to read the tea leaves, share the key ecommerce analytics metrics from Cyber 5, and what they could mean for brands this year.
With inflation, consumers are more price sensitive than ever. Retailers and marketplaces responded to this during Cyber 5 by offering many promotions.
"Interestingly enough, we saw promotions even higher this year [2022] than last, particularly with the recessionary environment being considered. I think a lot of shoppers are very hungry for deals." — Nathan Rigby, Co-founder at Analytic Index
Retailers executed promotions differently across the holiday shopping season, particularly Amazon and Walmart.
"The real call out is the difference between Amazon and Walmart. You look at the total number of promotions that occur on Amazon; it's a hundred times larger than the likes of Walmart," Rigby says. "To be able to see that many more promotions across the different departments become an incredibly important bellwether in terms of the difference between Walmart and Amazon."
Amazon’s promotion strategy during Cyber 5 is focused on flash sales, deals of the day, and coupon promotions. Walmart focused on rollback and traditional Prime Day and Black Friday deals.
Rigby says retail media was also big during the holiday shopping season, as both Walmart and Amazon gave brands another avenue through which they could promote their products and reach consumers.
There were other similarities between the two companies, as well. Both Amazon and Walmart offered more deals on Cyber Monday than on Black Friday. Most departments across Amazon and Walmart saw 4% to 7% more promotions on Cyber Monday. On Amazon, products were discounted by 21% on average, whereas it was 16% on average for Walmart.
"In terms of who won the discount war and the promoted space, Amazon completely overwhelmed the market in terms of the number of items that were on promotion, as well as the discounts themselves being about five percentage points higher than Walmart," Rigby says.
Though sports and outdoors (25%), clothing and jewelry (24%), and beauty and personal care (26%) experienced the steepest discounts, flagship products were among the top-performing products during Cyber 5.
These products included second-generation Apple AirPods, which performed well on both Amazon and Walmart. LEGO Star Wars and video games and players such as Pokémon and Nintendo Switch particularly did well on Amazon.
Rigby says he was surprised by the lack of product innovation during the 2022 holiday shopping season. Just a few years ago, Instant Pot was all the rage, but it seems that consumers are more willing to spend money on tried-and-true products in a high-inflation environment. Brands also may be less willing to take a financial risk on new innovations.
"If we're looking at Apple AirPods 2nd generation being the top-performing item, it really speaks to the impact that COVID had on innovation and product development," Rigby says.
Though brands like Apple, LEGO, Nintendo, and BISSELL did sponsored advertisements and promotions during Cyber 5, they didn’t offer premium discounts in the same way many other companies did.
Rigby says really well-executed and established brands have been able to succeed in both the Walmart and Amazon ecosystems, but enterprise-level brands often fare better with Walmart because of the brick-and-mortar experience it offers.
"The clear connection with their omnichannel and brick-and-mortar environments is an obvious reason why those types of brands are able to scale and really expand their digital offering and success in that Walmart ecosystem," he says.
Rigby says it’s crucial for brands to do a deep dive into channel-specific data to understand what drives performance on Walmart, Amazon, and other platforms.
"The more you know about yourself and your competitors in your category, the better, more efficient, and effective you will be at being able to deploy strategic assortment, pricing, promotions, organic search performance, and retail media effectiveness on Amazon, Walmart, Target, and any other ecommerce platform," he says.
As the Cyber 5 ecommerce analytics metrics indicate, what drives consumer buying behavior differs significantly on each channel, so brands need to understand what items perform best on each channel and why, what organic search terms drive better results for them, and what keywords should invest in promoting in a retail media environment.
Rigby says it’s also important for brands to leverage retail media in conjunction with promotions to boost their share of voice and brand awareness. Brands then can use both levers not only to boost search performance for individual items but also to holistically manage their brand across different categories.
After this, brands should continually measure and track their promotional effectiveness to ensure the investments they make actually increase the visibility of their overall brand portfolio.
"The retailers themselves are providing more levers to pull, as well as [more] data. It might be on a drip where we're all wanting it on a flow, but that is an important way to differentiate how you can compete, particularly with third-party players as well as competitive enterprise brands," Rigby says. "I believe that that data position and the levers you can pull through data becomes the way you can win in 2023."
To hear more of Rigby’s insights on how brands can position themselves for digital shelf success, listen to the full podcast episode of "Unpacking the Digital Shelf."
